There has been a lot of talk regarding the new stimulus package under President Biden, most of which revolves around the $1,400 being given. However, there is a bombshell being dropped in this package concerning Affordable Care Act (ACA) plans. This new bill is reducing the cost of health insurance by ensuring consumers who are eligible for premium tax credits have at least a couple plans to choose from that won’t cost more than 8.5% of their household income on. Here are 5 facts on how your ACA plan can change:
1. Larger subsidies
Many people who currently receive subsidies may qualify for bigger subsidies. According to the U.S. Department of Health and Human Services, four out of five ACA enrollees will be able find a plan for $10 or less per month after tax credits, and over 50% will be able to find a Silver plan for $10 or less per month.
2. More Subsidies
Many people who didn’t qualify for subsidies because their income was too high will now qualify for subsidies! Many premiums will decrease, on average, by $50 per person per month and $85 per policy per month. According to Healthcare.gov, 1 out of 4 enrollees will be able to upgrade to a higher plan category that offers better out of pocket costs at the same or lower premium compared to what they’re paying today.
3. Help for unemployed
People receiving unemployment compensation at any point in 2021 will qualify for subsidies as if their income was 133% of the Federal Poverty Line. This benefit will end at the end of 2021. In addition, people who were involuntarily terminated and offered COBRA will have their premiums covered for free until September 30, 2021.
4. Subsidies are Retroactive
The increased subsidies will start April 1st 2021. In order to receive them, you must resubmit your application if you currently have a Marketplace plan, or sign up for the first time during the Special Enrollment Period. However you receive the new increased subsidies, they will be retroactive to January 1st 2021!
5. Excess Subsidy Forgiveness
When obtaining health insurance through the Marketplace, you do it based on your projected income for the next year. If you happen to earn a higher income than expected, you have to pay back the excess premium subsidies you received. Due to the volatile nature of people’s income (loss of jobs, change in pay, etc.) excess premium subsidies for 2020 do not have to be repaid to the Internal Revenue Service.
Real Life Examples:
- Uninsured couples earning over $70,000 could save more than$1,000 per month on their monthly premium.
- A family of four making $90,000 will see their premiums decrease by $200 per month.
- An individual making $19,000 will be able to find health insurance coverage with no monthly premium, saving roughly $66 per month on average.
This is all great news for those enrolled in an ACA health plan and for those seeking health insurance. A Special Enrollment period has been instituted from now until May 15th 2021. These changes in the Marketplace are currently approved for two years. After that, Congress will need to intervene in order to keep them in place. Take advantage of the cost savings right now! If you have thought health insurance was too expensive for you, let us take a look! Click below to schedule a virtual meeting with us to get you affordable health insurance TODAY!
